Term
| WHAT DOES RESPA STAND FOR AND WHAT REGULATION IS IT ASSOCIATED WITH? |
|
Definition
-REAL ESTATE SETTLEMENT PROCEDURES ACT
-REGULATION X |
|
|
Term
| WHAT ARE THE TWO PURPOSES OF RESPA? |
|
Definition
1-ALLOWS CONSUMERS TO OBTAIN INFORMATION ON THE COSTS OF CLOSING
2-PROTECT CONSUMERS FROM EXCESSIVE SETTLEMENT COSTS AND UNEARNED FEES. |
|
|
Term
| WHAT AGENCY REGULATES RESPA? |
|
Definition
| THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT WRITES AND ENFORCES THE LAWS FOR RESPA. |
|
|
Term
| WHAT KINDS OF LOANS ARE COVERED BY RESPA? |
|
Definition
| COVERS FEDERALLY RELATED MORTGAGE LOANS |
|
|
Term
| WHAT ARE FEDERALLY RELATED MORTGAGE LOANS? |
|
Definition
| LOANS SECURED BY A FIRST OR SUBORDINATE LIEN ON RESIDENTIAL PROPERTY. |
|
|
Term
| WHAT 7 KINDS OF LOANS ARE EXEMPT FROM RESPA? |
|
Definition
-25 ACRES OR MORE
-BUSINESS, COMMERCIAL, & AGRICULTURE
-TEMPORARY FINANCING (BRIDGE LOANS)
-LOANS ON VACANT LAND. (EXCEPT IF FUNDS WILL BE USED TO LOCATE A MANUFACTURED HOME OR BUILD A STRUCTURE WITHIN TWO YEARS FROM THE SETTLEMENT DATE)
-ASSUMPTIONS WHICH ARE PERMISSIBLE WITHOUT LENDER APPROVAL
-LOANS SOLD IN SECONDARY MARKET
-LOAN CONVERSIONS, WHEN A NEW NOTE IS NOT REQUIRED AND THE PROVISIONS ARE CONSISTENT WITH THOSE OF THE ORIGINAL MORTGAGE |
|
|
Term
| WHAT ARE SETTLEMENT SERVICES? |
|
Definition
| THIRD PARTY ORGANIZATIONS LIKE APPRAISERS,INSPECTORS, CRA's, TITLE INSURERS, AND LOAN PROCESSORS THAT HELP PREPARE ALL PARTIES FOR CLOSING. |
|
|
Term
| WHAT ARE THINGS OF VALUE UNDER RESPA? |
|
Definition
| PAYMENT, ADVANCE, LOAN, OR SERVICE INCLUDING MONEY, DISCOUNTS, COMMISSIONS, SALARIES, STOCK, OPPORTUNITIES TO PARTICIPATE IN A MONEY-MAKING PROGRAM, SPECIAL BANKING TERMS, TICKETS TO THEATER OR SPORTING EVENTS, SERVICES AT SPECIAL RATES, AND TRIPS AT ANOTHER'S EXPENSE. |
|
|
Term
| WHAT IS A AGREEMENT OR UNDERSTANDING UNDER RESPA? |
|
Definition
| A WRITTEN OR VERBAL AGREEMENT OR EVEN AN AGREEMENT ESTABLISHED THOUGH A PRACTICE, PATTERN OR COURSE OF CONDUCT, TO OFFER THINGS OF VALUE IN EXCHANGE FOR THE REFERRAL OF SETTLEMENT BUSINESS. |
|
|
Term
| WHAT ARE FEE SPLITTING AND KICKBACKS UNDER RESPA? |
|
Definition
| THE SHARING OF FEES AMONG SETTLEMENT SERVICE PROVIDERS. NO PERSON SHALL GIVE OR ACCEPT ANY SPLIT, OR PERCENTAGE OF ANY CHARGE OTHER THAN FOR SERVICES ACTUALLY PERFORMED |
|
|
Term
| WHAT ARE MARKUPS UNDER RESPA? |
|
Definition
| A UNILATERAL INCREASE IN THE COST OF A SETTLEMENT SERVICE AND RETENTION OF THE ADDITIONAL FEE BY THE PARTY MAKING THE MARKUP. |
|
|
Term
| GENERALLY, WHAT DOES NESPA REGULATE? |
|
Definition
| THE COST TO CLOSE A LOAN. |
|
|
Term
| WHAT IS A SHAM AFFILIATED BUSINESS ARRANGEMENT UNDER RESPA? |
|
Definition
| A PARTNERSHIP OR JOINT VENTURE CREATED BETWEEN SETTLEMENT SERVICE PROVIDERS FOR THE ILLEGAL PURPOSE OF SPLITTING FEES UNDER THE GUISE OF A BONA FIDE AFFILIATED BUSINESS ARRANGEMENT |
|
|
Term
| WHAT IS BORROWER CREDIT UNDER RESPA? |
|
Definition
| HISTORICALLY KNOWN AS "YIELD SPREAD PREMIUM", IT IS A FEE PAID TO THE BORROWER BY THE LENDER WHEN THE LOAN IS ORIGINATED AT A HIGHER INTEREST RATE THAN THE PAR RATE. |
|
|
Term
|
Definition
| THE RATE THE BORROWER QUALIFIES FOR. |
|
|
Term
| WHAT ARE THE CLOSING COST DISCLOSURES REQUIRED BY RESPA? |
|
Definition
-GOOD FAITH ESTIMATE (GFE)
-SERVICING DISCLOSURE STATEMENT
-AFFILIATED BUSINESS ARRANGEMENT
-HUD-1 OR HUD-1A(FOR REFINANCES) |
|
|
Term
| WHEN MUST BROKERS OR LENDERS PROVIDE A GFE? |
|
Definition
| AT THE TIME OF APPLICATION OR MAIL IT WITHIN THREE BUSINESS DAYS AFTER RECEIPT OF THE LOAN APPLICATION |
|
|
Term
| WHAT ARE BUSINESS DAYS ACCORDING TO RESPA? |
|
Definition
|
|
Term
| WHO IS RESPONSIBLE TO ISSUE A GFE? |
|
Definition
| THE PARTY THAT TAKES THE APPLICATION. |
|
|
Term
|
Definition
| AN ESTIMATE OF COSTS DUE AT CLOSING. |
|
|
Term
| WHAT FEES ARE LISTED IN THE GFE? |
|
Definition
-DIRECT FEES:LOAN ORIGINATION, PROPERTY APPRAISAL, CREDIT REPORTING, TITLE INSURANCE, AND RECORDING THE MORTGAGE.
-INDIRECT FEES: BORROWER CREDITS |
|
|
Term
| WHAT ARE THE FOUR KEY AREAS OF FEES ON A GFE? |
|
Definition
-LENDER AND BROKERAGE CHARGES
-TITLE CHARGES
-GOVT CHARGES
-PREPAID ITEMS AND DEPOSITS |
|
|
Term
| WHAT ARE LENDER AND BROKER CHARGES? |
|
Definition
| FEES FOR LOAN ORIGINATION, APPRAISALS, CREDIT REPORTS, INSPECTIONS, MORTGAGE BROKER SERVICES, UNDERWRITING AND PROCESSING . |
|
|
Term
|
Definition
| COSTS OF THE TITLE SEARCH, TITLE INSURANCE, AND NOTARY FEES. |
|
|
Term
|
Definition
| THE COST OF RECORDING THE MORTGAGE TRANSACTION IN THE PUBLIC LAND RECORDS. |
|
|
Term
| WHAT ARE PREPAID ITEMS AND DEPOSITS? |
|
Definition
| FEES PAID BY THE BORROWER AT THE TIME OF CLOSING |
|
|
Term
| WHAT HAPPENED ON JANUARY 1ST 2010 WITH RESPA? |
|
Definition
| USE OF THE REVISED GFE BECAME MANDATORY. THIS REVISED GFE GIVES CONSUMERS AN ACCURATE ESTIMATE OF SETTLEMENT COSTS. |
|
|
Term
| UNDER THE NEW REGULATION FOR RESPA, WHAT MUST BE LISTED ON THE REVISED GFE AND WHEN SHOULD IT BE PROVIDED? |
|
Definition
| ALL CHRAGES OTHER THAN THE INTEREST RATE AND FEES TIED TO THE INTEREST RATE AND THEY MUST BE MADE AVAILABLE AT LEAST TEN BUSINESS DAYS FROM THE TIME THAT THE GFE IS PROVIDED. |
|
|
Term
| AT SETTLEMENT, WHAT CHARGES CANNOT EXCEED THE CHARGES LISTED ON THE GFE? |
|
Definition
-THE ORIGINATION CHARGE
-CHARGES FOR LOCKING AN INTEREST RATE, WHILE THE RATE IS LOCKED
-THE ADJUSTED ORIGINATION CHARGE, WHILE THE RATE IS LOCKED
-TRANSFER TAXES
- |
|
|
Term
| WHAT THIRD PARTY FEES CANNOT EXCEED THE CHARGES STATED ON THE GFE BY A CERTAIN PERCENTAGE? WHAT IS THAT PERCENTAGE? |
|
Definition
-SETTLEMENT SERVICES WHEN THE LENDER CHOOSES THE SETTLEMENT SERVICE PROVIDER
-LENDER-REQUIRED SERVICES, TITLE SERVICES, AND TITLE INSURANCE, WHEN THE BORROWER USES A PROVIDER IDENTIFIED BY THE LOAN ORIGINATOR
-GOVT RECORDING CHARGES |
|
|
Term
| IF A LOAN ORIGINATOR CHARGES A BORROWER AN AMOUNT THAT WRONGFULLY EXCEEDS THE AMOUNT LISTED ON THE GFE, HOW LONG DOES THE LENDER HAVE TO GIVE THE EXCESS MONEY BACK? |
|
Definition
|
|
Term
| WHAT FOUR REASONS ARE PERMISSIBLE TO ISSUE A NEW GFE BECAUSE OF CHANGED CIRCUMSTANCES? |
|
Definition
-ACTS OF GOD, WAR, DISASTER, OR OTHER EMERGENCY
-INFORMATION PARTICULAR TO THE BORROWER OR TRANSACTION THAT WAS RELIED ON IN PROVIDING THE GFE AND THAT CHANGES OR IS FOUND TO BE INACCURATE AFTER THE GFE HAS BEEN PROVIDED. (CREDIT QUALITY, APPRAISAL AMOUNT)
-NEW INFORMATION PARTICULAR TO THE BORROWER OR TRANSACTION THAT WAS NOT RELIED ON IN PROVIDING THE GFE
-OTHER CIRCUMSTANCES THAT ARE PARTICULAR TO THE BORROWER OR TRANSACTION, INCLUDING BOUNDARY DISPUTES, NEED FOR FLOOD INSURANCE, OR ENVIRONMENT PROBLEMS |
|
|
Term
| WHEN SHOULD THE REVISED GFE BE PROVIDED UNDER CHANGED CIRCUMSTANCES? |
|
Definition
| WITHIN THREE DAYS OF THE LOAN ORIGINATOR BECOMING AWARE OF INFORMATION THAT CONSTITUTES CHANGED CIRCUMSTANCES. |
|
|
Term
| WHAT PIECES OF INFORMATION CONSTITUTE A COMPLETED LOAN APPLICATION? |
|
Definition
-BORROWER'S NAME
-''MONTHY INCOME
-''SOCIAL SECURITY NUMBER
-THE PROPERTY ADDRESS
-ESTIMATED VALUE OF THE PROPERTY
-THE AMOUNT OF THE MORTGAGE LOAN SOUGHT BY THE BORROWER |
|
|
Term
| WHAT DOES THE HUD SETTLEMENT COST BOOKLET, "BUYING YOUR HOME: SETTLEMENT COSTS AND INFORMATION" TELL THE BORROWER? |
|
Definition
-EXPLAINS THE SETTLEMENT PROCESS
-TELLS BORROWERS THAT THEY HAVE THE RIGHT TO NEGOTIATE THE TERMS OF A LOAN
-REVIEWS THE PROTECTIONS THAT RESPA CREATES FOR BORROWERS
-WARNS BORROWERS THAT THEIR USE OF FALSE INFORMATION ON A LOAN APPLICATION CAN LEAD TO THE LOSS OF THEIR HOME, A POOR CREDIT RATING, AND EVEN CRIMINAL PROSECUTION FOR FRAUD. |
|
|
Term
| WHEN IS THE SETTLEMENT COST BOOKLET DUE? |
|
Definition
| THREE BUSINESS DAYS AFTER COMPLETION OF A LOAN APPLICATION FOR A PURCHASE TRANSACTION. |
|
|
Term
| How many settlement cost booklets must be provided? |
|
Definition
| Only 1, even if there are multiple borrowers such as a husband and wife. |
|
|
Term
| You can reproduce a settlement cost booklet in any form, stamp it with a mortgage professional's contact info and translate it into any language, but what can't you do to a settlement cost booklet? |
|
Definition
| YOU CANNOT COMBINE IT INTO A LARGER DOCUMENT WITH OTHER DISCLOSURES. |
|
|
Term
| WHAT TYPE OF LOANS DOES THE MORTGAGE DISCLOSURE STATEMENT APPLY TO AND WHEN IS IT DUE? |
|
Definition
| IT APPLIES TO FIRST-LIEN MORTGAGES AND IS DUE THREE BUSINESS DAYS AFTER THE COMPLETION OF THE LOAN APPLICATION. |
|
|
Term
| WHAT DOES THE MORTGAGE SERVICING DISCLOSURE STATEMENT TELL THE BORROWER? |
|
Definition
| WHETHER THE LOAN CAN BE SOLD SOLD, ASSIGNED, OR TRANSFERRED DURING THE LIFE OF THE LOAN SERVICING TRANSFER STATEMENT. |
|
|
Term
| IF A SETTLEMENT SERVICE PROVIDER REFERS A LOAN APPLICANT TO ANOTHER BUSINESS FOR SETTLEMENT SERVICES, WHAT MUST THEY PROVIDE THE BORROWER WITH? |
|
Definition
| AN AFFILIATED BUSINESS ARRANGEMENT DISCLOSURE. |
|
|
Term
| WHAT DOES THE AFFILIATED BUSINESS ARRANGEMENT DISCLOSURE TELL THE BORROWER? |
|
Definition
-DESCRIBES BUSINESS ARRANGEMENT, INCLUDING PERCENT OWNERSHIP OF EITHER OF THE COMPANIES IN EACH OTHER
-THE COST CHARGED FROM REFERRED PROVIDER
-TELLS BORROWER THEY ARE NOT REQUIRED TO USE THE REFERRED PROVIDER, UNLESS IT IS A PARTICULAR ATTORNEY, APPRAISER, OR CREDIT REPORTING AGENCY) |
|
|
Term
| GENERALLY WHAT IS THE HUD-1 OR HUD-1A? |
|
Definition
| THE FINAL RECEIPT FOR THE SETTLEMENT TRANSACTIONS. |
|
|
Term
| WHAT IS THE DEFINITION OF THE HUD-1 OR HUD-1A? |
|
Definition
| A STATEMENT THAT SHOWS THE ACTUAL COSTS OF SETTLEMENT IN A MORTGAGE LENDING TRANSACTION. (HUD-1A IS FOR REFINANCING) |
|
|
Term
|
Definition
| AT THE TIME OF CLOSING BUT THE THE BORROWER MAY REQUEST A COPY ONE BUSINESS DAY PRIOR TO SETTLEMENT. IT MUST BE MAILED INA REASONABLE PERIOD OF TIME IF THE BORROWER OR THEIR AGENT IS NOT PRESENT AT CLOSING. |
|
|
Term
| HOW DOES SECTION 10 PROTECT CONSUMERS? |
|
Definition
| IT PROTECTS THEM BY ENSURING BORROWERS KNOW HOW MUCH MONEY IS DEPOSITED INTO ESCROW ACCOUNTS AND BY STOPPING LENDERS FROM OVERCHARGING THE BORROWERS FOR ESCROW DEPOSITS. |
|
|
Term
| WHAT TWO DISCLOSURES ARE REQUIRED BY SECTION 10? |
|
Definition
| THE INITIAL ESCROW STATEMENT AND THE ANNUAL ESCROW STATEMENT |
|
|
Term
| WHEN IS THE INITIAL ESCROW STATEMENT DUE? |
|
Definition
| NO LATER THAN 45 DAYS AFTER THE ESCROW ACCOUNT HAS BEEN ESTABLISHED. |
|
|
Term
| HOW DOES SECTION 10 SPECIFICALLY PROTECT BORROWERS? |
|
Definition
-ANNUAL ANALYSIS OF ESCROW ACCOUNT
-LIMITING THE CUSHION TO COVER ESCROW DISBURSEMENTS TO 2 MONTHS
-REFUNDING SURPLUSES OVER $50 WITHING 30 DAYS AFTER THE ESCROW ACCOUNT ANALYSIS THAT SHOWS THE SURPLUS |
|
|
Term
| HOW DOES SECTION 6 UNDER RESPA PROTECT THE BORROWER? |
|
Definition
| ENSURES BORROWERS HAVE ADEQUATE NOTICE WHEN THEIR LOAN SERVICING IS BEING TRANSFERRED TO ANOTHER INSTITUTION |
|
|
Term
| WHEN MUST THE SERVICING TRANSFER STATEMENT BE SENT? |
|
Definition
| 15 PRIOR TO THE TRANSFER BY THE LENDER WHO IS TRANSFERRING AND WITHIN 15 DAYS AFTER THE TRANSFER FROM THE COMPANY WHO RECEIVED THE TRANSFER |
|
|
Term
| AFTER RECEIVING A TRANSFERRED LOAN, WHAT CAN'T THE COMPANY DO TO THE BORROWER? |
|
Definition
| CHARGE THEM ANY LATE FEES FOR 60 DAYS. |
|
|
Term
| HOW LONG MUST LENDERS KEEP RESPA DISCLOSURES? |
|
Definition
|
|
Term
| WHAT DOES SECTION 8 OF RESPA PROHIBIT LENDERS AND THEIR SERVICE PROVIDERS FROM DOING? |
|
Definition
(A)THEY CANNOT GIVE OR ACCEPT REFERRAL FEES, KICKBACKS, OR THINGS OF VALUE UNLESS WORK AS DONE TO EARN THE FEE.
(B) PROHIBITS THE SPLITTING OF FEES |
|
|
Term
|
Definition
| THE UNILATERAL INCREASE BY A SETTLEMENT SERVICE PROVIDER OF A CHARGE FOR A SERVICE THAT AS COMPLETED BY ANOTHER PROVIDER |
|
|
Term
|
Definition
| THE DIFFERENCE BETWEEN THE RATE THE BORROWER ACCEPTS AND THE RATE THE BORROWER QUALIFIES FOR |
|
|
Term
| WHAT ARE THE PENALTIES FOR VIOLATING RESPA? |
|
Definition
| FINES UP TO 10,000 AND 1 YEAR IN PRISON |
|
|
Term
| WHAT DOES RESPA STAND FOR? |
|
Definition
| REAL ESTATE SETTLEMENT PROCEDURES ACT |
|
|
Term
| WHEN IS THE INITIAL ESCROW STATEMENT DUE? |
|
Definition
| NO LATER THAN 45 DAYS AFTER THE ESCROW ACCOUNT HAS BEEN SET UP. |
|
|
